The global oil source rose to 2.5 million barrels according to July after Saudi Arabia stopped its voluntary production cut of 1 million barrels according to the day and U.S. crude oil production began to increase again. Including the inability of the United Arab Emirates to meet its production relief targets, the global source is expected to remain unchanged by 90 million barrels in line with August.
In its August oil market report released Thursday, the International Energy Administration (IEA) reiterated its July projection that global oil would fall by 7.1 million barrels according to the day in 2020. The company also raised its estimate of the call to contraction by 140,000 barrels on a constant basis. with the day. 8.1 million barrels consistent with the day, the first degradation of the EIG to the call for estimates in several months.
The dismantling is entirely due to uncertainty about how temporarily the COVID-19 pandemic will sink and others will start driving again.
Demand for fuel for road transport (petrol and diesel) “slightly stronger” than expected in the first part of 2020. Looking ahead, the IEA said that “for the time being part of the year, we remain cautious and the resurgence of Covid-19 cases has noticed that we lower our estimates, basically for gasoline.”
Since April 1, when Brent was quoted below $25 in line with the barrel, the value of the benchmark quality had risen to more than $43 in line with the barrel in July. In its August report, the IEA said July crude is quoted in a narrow diversity of about $3 consistent with the barrel. West Texas Intermediate (WTI) averaged $40.77 consistent with the barrel in NYMEX last month, and The Brent averaged $43.22 consistent with the barrel.
The IEA noted that futures costs were emerging faster than existing spot costs, a position in the commodity market known as contango. The gap between spot and future costs narrowed in June, leading to falls in inventories, which in turn led to higher futures costs.
Crude oil inventories in OECD countries rose to 16.2 million barrels in June, for a total of 3.24 billion barrels. The IEA also noted that the floating garage increased from a record 220.5 million barrels in June to 184.8 million barrels in July. The floating garage refers to loaded crude oil carriers that circulate in circles while waiting for buyers.
Global demand for crude oil is now estimated at 91.9 million barrels in line with the day, a decrease of 8.1 million barrels year-over-year. The EIG also reduced its 2021 estimate from 240,000 barrels consistent with the day to 97.1 million barrels, largely due to continued weakness in demand for aviation fuel.
With WTI at around $40 consistent with the barrel, U.S. crude oil production is emerging again, the IEA said. From a minimum of 10 million barrels consistent with May, U.S. production has increased to 10.7 million barrels last week.
WTI crude was traded at about $42.50 on the barrel on Thursday morning, 0.2% less than Wednesday’s $42.67 settlement. Brent crude traded nearly 0.4% at about $45.25.